Krispy Trades and Crumbling Retail: Why Meme Stocks Are Screaming Late-Cycle Risk

In partnership with

AI founders: Got a game-changing startup?

Building the future of AI? Here's your shot at $50K to make it happen.

The Next Big AIdea pitch competition is live. If you've got an AI startup that's changing how businesses grow, we want to see it.

Record a 60-second pitch and you could win $50,000 cash, $25K in AWS credits, 600K Clay credits + Pro Plan, and exposure to millions through HubSpot Media's network.

Five finalists get flown to San Francisco to pitch live at INBOUND 2025 in front of 1,000+ industry leaders.

Your AI idea deserves more than just another LinkedIn post.

Submit your pitch today

1. Meme Mania 2.0: Same Story, Dumber Ending

Welcome back to the absurdist theater of American markets. This week, meme stocks exploded off the lows — not because of improving fundamentals, but because retail is back to gambling with the last fumes of liquidity.

We’ve now seen:

• GoPro (GPRO) soar up to 90% in premarket.

• Krispy Kreme (DNUT) spike 70% despite falling sales.

• Opendoor (OPEN) double Monday, plunge Tuesday.

• Kohl’s (KSS) rip 100% in early trading before a NYSE halt kicked in for volatility.

It’s not a rotation. It’s not a value trade. It’s a speculative blowoff. And if you think this is bullish, you’re reading the cycle backwards.

2. The Broken Business Models Behind the Boom

Let’s cut through the smoke and look under the hood:

📷 GoPro ($GPRO):

Once a $98 stock post-IPO, now barely $2. Down 98% over a decade. Revenue shrank 13% YoY in Q1. Cash-burning, product-stagnant, and no longer relevant in a smartphone world.

🍩 Krispy Kreme ($DNUT):

Q1 revenue dropped 15% YoY. Inflation’s crushed input costs. Margins are thin, and discretionary food spending is the first casualty in a downturn. Meme traders didn’t care.

🏘️ Opendoor ($OPEN):

A glorified flipping algorithm with a 21% short float, hemorrhaging capital in a declining housing market. Monday’s pump was followed by a 10% dump on Tuesday. Classic bagholder bait.

🛍️ Kohl’s ($KSS):

The most grotesque of the bunch. Up 100% in early trading before getting halted. Same-store sales down 6.7% in Q4, another 4.1% in Q1. CEO ousted for ethics violations. Still projecting a 6% drop in sales for FY2025. And yet... it doubled. That’s not a rally. That’s a hallucination.

3. This Isn’t a Bull Market — It’s a Liquidity Mirage

Retail isn’t just trading dumb — they’re chasing shadows. The macro backdrop is not improving:

• Global PMIs are flatlining or declining.

• Small business optimism is deteriorating.

• Commercial real estate delinquencies are rising.

• Earnings revisions are rolling over again for Q2.

But beneath the surface, the Treasury General Account (TGA) is drawing down, releasing short bursts of liquidity. Reverse repos have also dropped sharply. That liquidity isn’t finding productive assets — it’s flowing into option-fueled mania.

Add in the popularity of zero-DTE (zero days to expiration) contracts, and you get what we’re seeing: a synthetic momentum loop with no tether to reality.

4. Behavioral Risk Is Off the Charts

We’ve entered the terminal stage of retail euphoria — a heady cocktail of:

• Short squeeze worship (e.g., KSS with 49% short float).

• Attention arbitrage, where stocks exist to be meme’d, not managed.

• Volatility chasing, where options order flow drives the underlying.

• Moral hazard, thanks to 2020-style bailouts and zero accountability for losing.

Retail isn’t stupid — it’s desperate. With the Fed signaling potential cuts, AI trades already crowded, and long-duration tech exhausted, the mob is running back to what worked last time: low-float garbage with social virality.

5. Here’s the Smarter Bet: Track Informed Capital, Not Hype

If you’re serious about generating asymmetric alpha, stop following Reddit. Start following the people making the rules.

Quantbase gives you the tools to do just that. It allows you to mirror the portfolios of U.S. politicians and corporate insiders — people with superior information, legislative foresight, and the power to front-run sectors before the public has a clue.

Instead of YOLO’ing into doughnut stocks, here’s a structured route:
Track Congressional portfolios via Quantbase and align your capital with the ones who move fiscal levers.

Politicians don’t touch meme stocks. They’re buying defense, energy, semis, and infrastructure ahead of spending packages. That’s where capital flows with intention — not hysteria.

Final Take: This Is Peak Denial, Not a New Paradigm

We’re watching the late-cycle playbook unfold in real time. Retail is spinning the wheel on nostalgia and volatility, but the fundamentals are eroding beneath their feet.

The next phase is always the same: retail gets crushed, insiders rotate out quietly, and the drawdown begins after the circus leaves town.

Don’t chase spectacle. Follow signal.

— Analyzed Investing